PHOENIX - Gov. Jan Brewer will propose a major revamping of how the state funds schools, a move that could funnel more money to private and parochial schools.

In a speech Friday, Brewer boasted of Arizona being a leader in "school choice" with parents given options beyond traditional public schools, including a large system of privately run public charter schools and state tax credits to help students attend private and parochial schools.

But Brewer told the Arizona Chamber of Commerce and Industry the current funding system has not kept pace, with public schools getting a fixed amount of money for each student enrolled. A similar system exists for state aid to universities and community colleges.

"Whether it's a K-12, community college or university classrooms, we can no longer afford to reward institutions for merely finding students to occupy desks for part of the day or part of the year," she said. "Instead, we must invest our resources to fund the schools and support the teachers who deliver the results for our children, no matter the educational setting."

Brewer stressed her commitment to fund education is linked to "a setting of parents' choosing."

But she didn't promise any more cash for education, or to restore the cuts she helped to make during the last two years, even though the state will have its first surplus since 2006.

Just last year state lawmakers cut aid to public schools by $183 million. Brewer put the figure at closer to $134 million, with at least part of the difference due to increased federal aid.

But the governor said in an interview that she wants to earmark some of anticipated surplus to pay down debt Arizona incurred to balance its books during the past few years. She said, now that the state has a balanced budget, there will be "no restorations."

And there could be less money for public schools if lawmakers approve an expansion of existing programs allowing individuals to divert some of what they would otherwise pay in income taxes to help students attend private and parochial schools.

Current law gives individuals a dollar-for-dollar credit against state income tax for money donated to organizations that provide scholarships for tuition to these schools, up to $500 for individuals and $1,000 for couples.

Proponents contend this increases school choice options for parents while saving money for the state by taking children out of public schools.

That program, however, has generated debate amid concern beyond the loss of tax dollars. One issue is the question of how much of the money goes to children who would attend private schools anyway, and families capable of affording the tuition.

Sen. Rick Murphy, R-Glendale, is trying to expand those credits, creating another program with the same dollar-for-dollar credits. He said increasing what people can give will eliminate waiting lists of parents who cannot afford to send their children to private schools.

To combat claims the moves undermine the budget, the program is largely designed only for students who move from public schools. Murphy said that makes the new credits "budget positive," meaning the state will lose less in tax revenues than it would have to pay if these students attended public schools.

Gubernatorial press aide Matthew Benson said the concept already has the governor's blessing.

Brewer already has been taking other steps to revamp education.

One step was to appoint Craig Barrett, a charter-school executive, to chair her Arizona Ready Education Council.

Barrett, a former chief executive of Intel, said he intends to push for a system where teachers are paid based on their performance, scrapping the current method, which is based on both tenure and post-graduate credits.

He also wants to eliminate requirements that teachers must have a teaching degree and be certified by the state.

Charter schools, like the chain Barrett runs, already are exempt from those mandates. And Barrett said the fact they survive on less money than traditional public schools proves the answer is not more cash, but in focusing on what works.

Brewer said on Friday she shares that goal.

"We must think about how to fund the results we want, from state government and from our schools and universities," she said, specifically mentioning the council Barrett heads.

Brewer's comments come as a group of educators and others are crafting a new sales tax designed to help fund education.

That is an issue because one of the reasons the state has a balanced budget is that Brewer successfully pushed for voters to enact a temporary one-cent hike in 2010, bringing in close to $1 billion a year. The tax ends on May 31, 2013.

Any new tax likely would need voter approval.

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